South Tyneside manufacturer Faltec Europe has revealed it is spending £12m to relocate its business.

Faltec, which makes injection moulded parts for the automotive industry, currently operates a plant at Boldon Business Park but is preparing to move after receiving increased business from car giant Nissan.

While the company has not currently disclosed its new location, it is expected to stay in the North East to service Nissan. Faltec currently employs around 370 people in the region..

Speaking in the company’s accounts, deputy managing director Keith Wakley said: “Faltec Europe has recently been awarded a very significant nomination for future business for the next generation Qashqai from Nissan Sunderland plant. As a result, Faltec Europe will relocate to and invest in new purpose built manufacturing facilities and will also invest in significant new plant and machinery, funded with a capital injection of £12m from Faltec Co Ltd.”

Financial figures for the 2018 financial year showed that Faltec managed to reduce its operating loss from £7.7m to £4.1m. The firm’s loss after tax came in at £4.7m.

Meanwhile turnover increased by £1m to £37.4m, largely due to a rise in product volumes. The company said it has improved its operations since being hit with production issues in the first quarter of 2017.

Nissan continues to be Faltec’s biggest customers with the South Tyneside firm making parts for the Nissan Leaf, Qashqai and Infiniti. The firm also makes parts for the Renault and BMW vehicles.

Faltec has also been repaid more than £400,000 in fines for health and safety failures at its North East factory despite pleading guilty.

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The company was responsible for two serious health and safety incidents that caused five people to fall ill and left a teenager with first-degree burns.

The first incident saw the Boldon firm suffer from an outbreak of Legionnairres’ disease which led to five people becoming seriously ill.

Badly-managed water cooling systems allowed legionella bacteria in the water supply to grow to “potentially lethal levels”. Two employees, two agency workers and a local resident contracted the disease.

Water cooling towers at the Faltec plant in Boldon (Image: Newcastle Chronicle)

The second incident occurred when a 19-year-old man was injured following an explosion at the plant.

Faltec was prosecuted by the Health and Safety Executive last year and pleaded guilty to both cases. The company was fined £1.6m.

But Faltec’s financial accounts for the year ending December 31 2018 reveal that the company has managed to claw back around a quarter of the fine after appealing the punishment in court.

Mr Wakley said: “During 2015, the company was impacted by two significant health and safety issues, the total cost of which amounted to £1.638m. The court case was held in 2018, with Faltec Europe entering a guilty plea to the two cases. The outcome was a fine of £1.6m in line with the value of the provision. This was paid in full during 2018.

“£38,000 provision continues to be carried to cover certain expenses relating to the case which are still outstanding.

“An appeal was lodged during 2018 with respect to one of the cases. This was heard at the Court of Appeal in March 15 2019. On March 28 2019 the Court of Appeal revised the original judgement to a fine of £1.18m plus costs, which results in an amount reimbursable to the company of £420,000.”